Kate Bayley, conveyancer at Coodes Solicitors, says selling off a portion of your land as a transfer of part is more complex than many people expect.
The property boom during the pandemic has made development land more desirable, particularly here in the South West. So, if you have a large plot you may be tempted to sell off part of your land.
This may be for the purposes of development. However, some of our clients simply want to transfer small parcels for minimal value to reduce the size of their garden. Others seek to buy land from a neighbour to extend their garden or gain a parking space. While this may be a great opportunity, it is important to research the process and ensure you understand what is involved.
There is a misconception that selling part of your land for development just involves a simple transaction, particularly if the purchase price is nominal. This is not the case. There are many steps to go through to complete a transfer of part. Whether it be selling off a small piece of garden or a large building plot, it involves a complex legal process. The key is to get advice early and plan thoroughly.
What is a transfer of part?
In simple terms, a transfer of part involves selling part of your property. This includes splitting off a portion of the land on your property to sell to someone for development
The process includes registering the new title with the Land Registry. You will need legal advice from an experienced conveyancer to complete a transfer of part. Getting their input early will help ensure you fulfil all the legal requirements and understand all the details of the sale.
Creating a Land Registry Compliant Plan
At an early stage, you will need to commission a surveyor to produce a Land Registry Compliant Plan. This is sometimes called a boundary plan, lease plan or conveyance plan. It is an important document that accurately shows the exact portion of land you are selling and marks out its boundaries.
As well as defining the boundaries, you will need to decide what the boundary structures will consist of. For example, this could be a wall, fence or hedge. You will also have to establish who should own, and continue to maintain, each boundary. Again, getting legal advice will help you make the right decision.
The plan also needs to indicate access and services to each property, as well as any land or property that you are retaining.
Establishing easements for the property
Before completing on a transfer of part, you will need to get legal advice to establish if the plot being sold off will require any rights. These rights, which are known as easements, typically include:
- Rights of access. For example, this could mean access rights for the new property owner over the seller’s retained land.
- Rights of services. For example, the new property owner may be able to to connect into and use any services that are located in, under or over the seller’s retained land or property).
You will need to get legal advice to ensure you understand the implications of any easements you place on the property.
Placing covenants on the land
As the seller, you need to think carefully about how you would wish the land to be used. Is there anything you would wish to prevent, such as a particular type of property being built? If so, you may need to place a covenant on the land.
Like easements, covenants can also be positive and negative, either giving or denying the property owner certain rights. For example, a covenant could mean the property owner pays towards the maintenance and upkeep of an accessway or it could prevent the property from being used as a holiday let.
Securing consent from your mortgage lender
If you have a mortgage, you will need to work out how to deal with the loan and agree this with your lender. Do you intend to pay all of the loan, part of the loan or request the lender to release the plot from your mortgage?
Once you have worked out the best approach for you, you will then need to agree this with your mortgage lender, who will probably require a valuation on the land.
The pandemic has caused many of us to reassess our lives and consider how we can make the best of what we have. If, for you, this includes selling off part of your plot for development or buying a bit of land to gain that extra garden space you’ve always desired, get legal advice early. The process will probably be more complex than you first imagine. Discussing your plans with a conveyancer will help ensure the process goes smoothly, giving you the best chance of a successful sale.
For further information or advice please contact Kate Bayley in Coodes Solicitors’ Residential Property team on 01409 255901 or email@example.com.